The Great Depression

1. The Great Depression Ch 15

2. The Crash • Until mid-September, 1929, market prices rose beyond real value of stocks. • Prices began _______________________. • Late October, prices began to fall faster as investors began to sell. • Banks bought all the stock they could to stabilize market, but only ________________. • ________________________________-16.4 million shares by investors in effort to get their money out of market. • ______________________ dropped stock prices to fractions of original value.

3. Market declines are normal part of ________ ______________. • Period in which economy _____________________________________. • Market crash only hurt big investors at first. • Spread to affect all aspects of society.

4. Why Depression Spread • ___________________________-Debtors couldn’t pay back loans, banks lost money. • ___________________________-Consumers borrowed money, couldn’t pay it back. • __________-People rushed to withdraw $$ before banks closed. Banks called in loans, people couldn’t pay. • _________________-Banks ran out of money, closed. • _________________________-People lost savings when banks closed. • _________________________-No reason to produce when businesses couldn’t get loans and nobody was buying. • __________________________-Business cut back, laid off workers.

5. ______________________ began with Great Crash. • Most severe economic downturn in nation’s history. • Factories ____________________, closed due to lack of demand for products. • Led to closing of small local businesses (ex-restaurants). • Farm prices dropped. • By 1932, __________________ of all American workers was unemployed.

6. All world banks & markets were ___________. • When largest economy (USA) collapsed, all crashed. • ____________________ could not pay war debt. • ___________________ could not pay back loans to USA. • High tariffs limited foreign sales in USA markets.

7. Social Effects of Depression • Banks closed, __________________________. • Unemployed, couldn’t pay rent, evicted. • Many homeless built __________________ in parks, vacant lots. • ____________________ made of scrap material. • Many became _______________, travelling country on rails looking for work. • Farmers who couldn’t pay mortgages lost farms to banks.

8. The _________________ • Many farmers over-farmed their land, trying to make profit. • Plowed up grass holding soil down. • Several years of drought and wind led to huge _______________________. • Called ______________________. • Millions of tons of ______________ blew away, landed as far away as middle of Atlantic Ocean. • Midwestern farmers abandoned farms, migrated to California, looking for work. • Called “__________”.

9. Survival in the Depression • People did what they had to to survive. • Took ________________________________, hitchhiked around country looking for work. • People banded together to help each other. • When banks sold farms at auction, farmers would bid pennies on the farms, then return it to the farmers. • Called ______________________________. • Led many states to forbid farm ___________________.

10. Many young men _______________________ around USA looking for work. • Often, families couldn’t afford to keep them. • Called _______________. • Riding rails was dangerous-injury, death, ________________, beatings, robbery. • Even in bad times, people had sense of humor. • Slept under “__________________”-newspapers. • Waved “_________________”-pockets inside out. • Lots of cartoons in newspapers.

11. There were some positives. • Feb. 1933-______________________ passed-repealed Prohibition. • 1930-__________________________ began construction of ___________________________. • Tallest building in world for a time. • 102 stories (1,250 feet) tall. • Seen as symbol of hope for people.

12. Hoover during the Depression • Hoover originally insisted gov’t should not get involved. • Asked businesses to maintain _____________. • Did at first, but eventually had to begin cutting. • Hoover realized people needed help, began job programs-_______________, roads, parks. • Passed ___________________________-highest import tariff ever. • Hoped to protect USA business; backfired, Europe raised tariffs, slowed USA international business.

13. Created ______________________________ __________-gave credit to large companies, loaned $$ to banks. • Did not help small business, _________________. • Hoover believed relief should come from state/local gov’t. • Federal relief would destroy _________________, create more gov’t. • People felt Hoover ____________________, blamed him for all problems.

14. Summer 1932-20,000 WWI vets camped in Washington, DC. • Called themselves the ____________________. • Wanted their _________________________ early. • Hoover called in General _________________ ______________ & army to clear out protestors. • MacArthur used force to drive out protestors, many injured. • Hoover blamed.

15. _______________________________ • Democratic Party nominee for president. • Governor of _________________ 1929-1932. • FDR was willing to try anything to help pull USA out of Depression. • Promised USA a “_____________________”. • Supporter of __________________________. • In times of economic trouble, gov’t spending can make up for lack of private/business spending.

16. 1932 Election • Hoover campaigned on idea that FDR’s policies would ______________________ size & power of gov’t. • FDR campaigned on idea that Hoover’s policy of doing ______________________, and gov’t must step in and help. • FDR won by ___________________________; huge margin. • FDR would begin massive redesign of US gov’t.